A life insurer breached the Life Insurance Code of Practice when it failed to provide updates about the progress of a customer’s claim within the required timeframe on five occasions, a Notice of Determination by the Life Code Compliance Committee has found.
The LCCC says that following an assessment and investigation, it found the life insurer:
- Failed to provide updates about the progress of a customer’s claim within the required timeframe on five occasions, representing a significant breach
- Failed to request claim information within the required timeframe, representing a serious breach
- Communicated the claim decision 15 months after the required two-month timeframe had expired and failed to communicate the decision to the customer within 10 business days of having all the required information, representing serious breaches
The committee says the life insurer attributed the breaches to a staff member who did not follow established processes.
It notes that as remediation, the life insurer:
- Paid the customer interest for the claim delays and $2,500 as goodwill
- Reviewed the staff member’s portfolio for similar issues and engaged in performance management
- Reviewed and improved internal processes for breach identification, breach reporting, aged claim reviews and complaints
The LCCC says this case highlights that “…failures to meet communication timeframes can cause unnecessary frustration for customers and increase the likelihood of complaints, leading to increased costs for insurers.”
Life insurers should continually review the effectiveness of key controls to ensure issues are identified early and remediated, it states.
Click here to read the full determination.
Here's a little thought for the Life Code Compliance Committee, whoever you are.
A few weeks back I put a comment in this forum that the LICOP was "not wearing any clothes", as the Emperor's friends were prone to say.
I cited Justice Jackman in a Federal Court case FCA 1641 who states in paragraph 73 of his judgement that the LICOP " was not an approved code of conduct or a mandatory code of conduct for the purposes of SS 1101 AC or 1101 AF of the Corporations Act." So what is it indeed, just another PR stunt?
I think I asked that CALI, who apparently have inherited the LICOP from FSC, might make a comment. Haven't heard a bleep. What exactly do CALI do, apart from lobbying the government Thatthe life insurers (A.k.a. product manufacturers) should not be part of funding the CSLR
Note to Mr editor.: Can you seek comment from CALI please
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